How should i value a small apartment building with mixed sale comps?

[JacobD]

I’m trying to figure out how to accurately value a small apartment building I’m looking at, but the recent sales in the area are all over the place. Some are fully renovated and some are nearly distressed, so I’m not sure how to adjust for the condition of my potential purchase.

[Benjamin_M]

I’ve looked at a few nearby buildings with mixed condition histories and it always felt like the sale price hid more than it revealed. One fully renovated unit sold at a premium while a similar rent stack in a distressed condition dragged the price down, so comps aren’t reliable on condition alone.

[Jeffrey60]

We tried stripping capex from NOI and using an adjusted NOI to compare price per unit after forecasted maintenance, but it still depended on guessing future repairs and vacancies.

[Avery64]

I did a rough replacement-cost check on the building in its current state and compared that to the ask, and the gap was large in some cases, which made me question what the market was really paying for.

[KyleTJ]

Do you think the real problem is the mix of comps or is there some other factor masking value like debt terms or zoning that makes the numbers unreliable?